Two new housing programmes launched by the Hungarian government in February 2000 marked a policy turning point. One set out to provide a system of housing loans, while the other sought to prevent local-government rented housing from being eliminated altogether. There was justification for both, but both these measures of housing policy failed to take into account the ambitions of households and the reactions of the market. They set in motion processes that were unsustainable in budgetary and welfare terms, so that the effectiveness of the programmes became questionable. The scheme to subsidize housing loans was especially problematic, as the methods employed created long-term commitments whose effects cannot be corrected even in the short term. Those devising this housing policy did not rely on techniques of analysis with which the risks could have been assessed in time. There was no research or support for analysing independently the possible effects of lobby interests and no real alternatives were outlined for the politicians reaching the decisions.
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